Techno Electric & Engineering Company Limited · NSE:TECHNOE
Techno Electric & Engineering — Q2 FY2023 Earnings Presentation
41 slides from Techno Electric & Engineering's earnings presentation, November 2022
Slide 1: An Investor Presentation: Quarter Ended September, 2022
AN INVESTOR PRESENTATION Quarter Ended September, 2022
Slide 2: Corporate Overview, Business Segment Review, Financial Review
» Corporate Overview 03 » Business Segment Review 17 » Financial Review 38
Slide 3: Corporate Overview
orate Overview
Slide 4: Powering Value Creation
POWERING VALUE CREATION Techno Electric & Engineering Company Limited (TEECL) is among India’s largest in power-infrastructure companies. It is one of the most attractive proxies of India’s power sector, headquartered in Kolkata. 40+ Years 400+ Projects 25+ Years 400 Professionals of rich experience
Slide 5: Progressing with Confidence
PROGRESSING WITH CONFIDENCE » EPC » Generation » Design to Commissioning » Asset Ownership » Transmission Handover to » Operations and » Distribution Maintenance Maintenance Operation » Industrial Management * TEECL is divesting its renewable energy assets to concentrate more on its core businesses
Slide 6: Progressing with Confidence - Key Milestones
PROGRESSING WITH CONFIDENCE - (Contd.) KEY MILESTONES 1980 2009 2010 2021 Launched EPC Entered renewable Initiated transmission Data Centres services energy generation Asset Ownership COMPANY OVERVIEW BUSINESS SEGMENT REVIEW FINANCIAL REVIEW
Slide 7: Advancing with Experience and Expertise (EPC)
ADVANCING WITH EXPERIENCE AND EXPERTISE » Flue Gas Desulfurization Plant » Transmission & Distribution » Advanced Metering Infrastructure (Smart Metering) » Balance of plant » Captive waste heat recovery and upto 200 MW of conventional power plant on turnkey basis » Solutions for power-intensive ind
Slide 8: Advancing with Experience and Expertise (Asset Ownership)
ADVANCING WITH EXPERIENCE AND EXPERTISE » Build Own Operate and Transfer (BOOT) » Build Own Operate and Maintain (BOOM) » Provide annuity income » Capital intensive » Modest ROE » Stable multi-year income/cash flow » In-house EPC business » O&M revenues COMPANY OVERVIEW BUSINESS SEGMENT REVIEW FINAN
Slide 9: Advancing with Experience and Expertise (Green Power)
ADVANCING WITH EXPERIENCE AND EXPERTISE » Capital-intensive » Modest IRR » Multi-year stable income/cash flows » Green Power contributes 8% of total revenues and 31% of total EBIDTA of FY22 COMPANY OVERVIEW BUSINESS SEGMENT REVIEW FINANCIAL REVIEW
Slide 10: Advancing with Experience and Expertise (Data Centres)
ADVANCING WITH EXPERIENCE AND EXPERTISE » Develop ultra-scalable hyper-density Data Centres of 250 MW by FY2030 across India » EPC capabilities » Large infrastructure asset development and ownership experience, along with operations and maintenance services » Green power generation capacity COMPANY
Slide 11: Engineering That Is Different
ENGINEERING THAT IS DIFFERENT COMPANY OVERVIEW BUSINESS SEGMENT REVIEW FINANCIAL REVIEW
Slide 12: Once a Customer, Always a Customer
ONCE A CUSTOMER, ALWAYS A CUSTOMER TEECL primarily serves CPSUs, state-run utilities The Company follows the operating philosophy of and private sector customers (captive power plant and power distribution system for power intensive industries). Over the years, it » Helped build 50% of India’s natio
Slide 13: Growing Recognition
GROWING RECOGNITION Certificate of appreciation from Best player in 765 KV AIS IEI Industry Excellence Meritorious Performance in JBVNL for 100% electrification in Substation Construction in Award, 2016 Power Sector in 2011-12 by Dhanbad in 2018 India in 2018’ by PGCIL Ministry of Power Awarded Cert
Slide 14: Capable Leadership
CAPABLE LEADERSHIP Qualification » Postgraduate in Management (IIM, Ahmedabad) » Honours graduate in Industrial Engineering Experience » Merchant banker with National Grindlays Bank » Management consultant deputed to BHEL Association with TEECL » Grew TEECL into prominent Indian EPC company in power
Slide 15: Leveraging Opportunities
LEVERAGING OPPORTUNITIES » As per, Gazette notification (GOI) all Thermal Power Plants need to limit » Total target is of 175 GW of renewal » India has around 375 MW of Data Centre in H12020, their sulphur emission. energy capacity » Total Target is for 123 GW by 2026 » Out of the above, bids for 50
Slide 16: Utilising Corporate Strength
UTILISING CORPORATE STRENGTH Consistent Ability to embrace Efficient working Rich terrain upgradation to challenges capital management understanding industry-next technology On-time project Cost-effectiveness Partnership with Robust vendor completion large international eco-system manufacturers COMP
Slide 17: Utilising Corporate Strength - Contd.
UTILISING CORPORATE STRENGTH - (Contd.) Constantly improving Quicker project Recorded low gearing, focus on customer- completion than industry high credit rating, centricity and standards low-cost debt contractual obligations. Delivered most EPC and Management of customer Zero Penalty Record Transmi
Slide 18: EPC
EPC Transmission Asset Ownership Green Power
Slide 19: Delivering Consistently
DELIVERING CONSISTENTLY 63% ₹ 2,500+ million ROCE of EPC as on annual cash surplus 31 March, 2022 ~ ₹ 34,785 million 15% size of order book as on EPC EBIDTA Margin over the 30th September, 2022 last 5 years 24 months 92% revenue visibility Revenue of the total business from EPC as on 31 March, 2022
Slide 20: Major Domains of Operations
MAJOR DOMAINS OF OPERATIONS » Power distribution systems to power » Flue Gas Desulfurization EHV substations intensive industries » Turnkey solutions to captive power » EHV substations up to 765 kV (AIS/GIS) » Offsite piping systems plants » STATCOM installation up to 250 MVaR » Oil handling plant p
Slide 21: Operating Philosophies
OPERATING PHILOSOPHIES » Well-planned projects executed in sync with cash flow and contractual obligations » Focus on PAT/retained cash (not size of order book) » Conservative project management approach » Cash rich; low gearing; income mix (lumpy and annuity) » Zero penalty record; » Marginal worki
Slide 22: EPC Order Book as on 30th September, 2022
EPC ORDER BOOK AS ON 30th September, 2022 Name of the client Amount in mn 42.16% Rajasthan Rajya Vidyut 14,666.5 Prasaran Nigam Ltd. ₹ 14,973 million 17.39% PGCIL 6,047.6 Generation 7.39% REC Power 2,569.2 Distribution Co. Ltd ( JKPDD) 6.67% Khavda Bhuj 2,319.2 Transmission Limited Total - (KBTL) ₹
Slide 23: EPC Financials Over the Years
EPC FINANCIALS OVER THE YEARS Revenue (₹ in mn) EBITDA (₹ in mn) FY 21-22 9,882.34 FY 21-22 1,534.75 FY 20-21 7,916.87 FY 20-21 1,436.42 FY 19-20 7,843.49 FY 19-20 1,403.03 FY 18-19 8,791.51 FY 18-19 1,537.97 FY 17-18 11,733.70 FY 17-18 1,832.87 PBT (₹ in mn) FY 21-22 1,471.29 FY 20-21 1,371.54 FY 1
Slide 24: Transmission Asset Ownership
EPC Transmission Asset Ownership Green Power
Slide 25: Creating Value for TEECL
CREATING VALUE FOR TEECL Jhajjar KT – Haryana – Patran – Punjab – (Completed Kohima– Nagaland–(Completed (Completed and Exited) and Exited) and Exited) » 400 kV transmission system » Build, Own, Operate and Maintain » Build, Own, Operate and Maintain comprises Double Circuit Quad (BOOM) transmission
Slide 26: Encouraging Scope
ENCOURAGING SCOPE » Leverage EPC knowledge as transmission asset complements EPC » Enhance valuation and profitable encashment opportunities with long-term annuity incomes » Generate operations and maintenance revenues » Improve scale and stability with asset ownership » Reduce requirement to bid ag
Slide 27: Green Power
EPC Transmission Asset Ownership Green Power
Slide 28: Ensuring Sustainability
ENSURING SUSTAINABILITY Key highlights of the segment » Sold 44.45 MW of wind power assets at an effective valuation of ₹ 2,150 million during the Q1 FY 2016 » Sold 33 MW of wind energy assets at an effective valuation of ₹ 1,650 million in January 2017 » Exited the assets at the same price at which
Slide 29: Current Asset Overview
CURRENT ASSET OVERVIEW Wind Project Capacity 18 MW 111.90 MW Date of Acquisition/ During 2009-10 March 31, 2011 - February 24, 2012 Commissioning Location Karnataka Tamil Nadu Capacity 12 turbines x 1.5 MW each 48 turbines x 1.5 MW each; 19 turbines x 2.1 MW each PLF 18% - 24% 24% - 28% Tariff ₹ 3.4
Slide 30: Green Energy Assets
GREEN ENERGY ASSETS Revenue (₹ in mn) EBITDA (₹ in mn) PBT (₹ in mn) FY 21-22 856 FY 21-22 690 FY 21-22 290 FY 20-21 747 254 FY 20-21 471 254 FY 20-21 72 254 FY 19-20 683 235 FY 19-20 524 235 FY 19-20 119 235 FY 18-19 1,095 FY 18-19 954 FY 18-19 467 FY 17-18 1,242 FY 17-18 1,106 FY 17-18 682 Units g
Slide 31: India's Data Centre industry expected to grow significantly
As one of the world’s largest data subscriber population adapts to a new digital life, India’s Data Centre industry is expected to grow significantly.
Slide 32: Aligned to the Big Picture
ALIGNED TO THE BIG PICTURE Vision To create multiple ultra-scalable, hyper-density Data Centres. » Develop hyper-density Data Centres of 250 MW by FY2030 across India » Build an ultra-scalable, hyper-density Data Centre of 24 MW IT Load in Chennai, Tamil Nadu by FY2023 » Build an Data Centre of 24 M
Slide 33: Aligned to the Big Picture (Contd.) - Chennai Data Centre
ALIGNED TO THE BIG PICTURE (CONTD.) Chennai Data Centre SIRUSERI, Chennai Land Size & Built • Land Size – 4 acres Up in Sq. Ft. • Built Up Area – Approx. 200,000 sft Sq. Ft. Power Capacity • TEECL has captive renewable energy (wind turbines) of ~112 MW in Tamil Nadu, generating 220 MU annually. Time
Slide 34: Financial Review
@...: Review
Slide 35: Analysing Quarterly Financials - Q2FY23
ANALYSING QUARTERLY FINANCIALS – Q2FY23 Revenue EBITDA (₹ in mn) (₹ in mn) 2280.32 710.3 2735 854.1 EBITDA Margin Other income (%) (₹ in mn) 31.23 190.06 31.16 102.87 Profit after tax Interest Cost (₹ in mn) (₹ in mn) 588.07 13.00 633.86 12.52 Q2FY23 Q2FY22 COMPANY OVERVIEW BUSINESS SEGMENT REVIEW F
Slide 36: Analysing Quarterly Segment Result - Q2FY23
ANALYSING QUARTERLY SEGMENT RESULT – Q2FY23 Revenue (₹ in mn) REVENUE (₹ in mn) 1806 474 2254 481 EBIT (₹ in mn) EBIT (₹ in mn) 277 332 412 341 EBIT Margin (%) EBIT Margin (%) 15.33 69.90 18.28 70.97 Q2FY23 Q2FY22 Q2FY23 Q2FY22 COMPANY OVERVIEW BUSINESS SEGMENT REVIEW FINANCIAL REVIEW
Slide 37: Analysing Half Yearly Financials - H1FY23
ANALYSING HALF YEARLY FINANCIALS – H1FY23 Revenue EBITDA (₹ in mn) (₹ in mn) 4,009.80 1,187.60 4,629.60 1,405.90 EBITDA Margin Other income (%) (₹ in mn) 29.62 320.10 30.37 274.60 Profit after tax Interest Cost (₹ in mn) (₹ in mn) 943.58 27.32 1,089.25 30.13 H1FY23 H1FY22 COMPANY OVERVIEW BUSINESS S
Slide 38: Analysing Half Yearly Financials - H1FY23 (Segments)
ANALYSING HALF YEARLY FINANCIALS – H1FY23 Revenue (₹ in mn) Revenue (₹ in mn) 3,254 783.00 3,880 751.80 EBIT (₹ in mn) EBIT (₹ in mn) 513.25 497.88 730.47 473.80 EBIT Margin (%) EBIT Margin (%) 15.77 63.58 18.83 63.03 H1FY23 H1FY22 H1FY23 H1FY22 COMPANY OVERVIEW BUSINESS SEGMENT REVIEW FINANCIAL REV
Slide 39: Annual Financials
ANNUAL FINANCIALS EBIT Revenue (₹ in mn) (₹ in mn) EPC EPC 1526.49 9884.28 7916.87 1449.01 Energy 290.93 Energy 856.32 326.31 751.85 PAT Other Income (₹ in mn) (₹ in mn) PAT Other Income (Normal) 2,603.43 403.94 2,044.42 397.92 Other Income (One time) 1100.00 438.00 March 2022 March 2021 1. Our EPC
Slide 40: Annual Financials - Balance Sheet
ANNUAL FINANCIALS - (Contd.) Balance Sheet (in Millions) 2021 2022 SOURCES OF FUNDS Shareholders’ funds 16,162 18,367 Minority interest --- --- Loan funds --- --- Deferred tax liabilities 1,150 1,220 Other liabilities and provisions 407 1310 Total 17,719 20,898 APPLICATION OF FUNDS Net fixed assets
Slide 41: Techno Electric & Engineering Company Limited - Corporate Office
TECHNO ELECTRIC & ENGINEERING COMPANY LIMITED Corporate Office: 1B Park Plaza, 71 Park Street, Kolkata 700 016
Techno Electric & Engineering Company — Q2 FY2023 Earnings Presentation on 6ix